is-a-trust-right-for-meIs a trust right for me, is the first question that should pop in my head when i am thinking of trust. When people talk about a trust you have to think if their right for you, many think about the wealthy. Some believe you need to have large sums of money, a mansion and an expensive car to warrant having your own trust. Trusts, however, are for just about anyone as a means of effective estate planning. They are used for individuals and couples of any level of income and assets. When used as part of a comprehensive estate plan, trusts provide protection, privacy and certainty for you and your loved ones.

Trusts can provide many benefits, not only to the original creators, but to the beneficiaries as well.

Benefits of Trusts:

  • Protection from the expense and delay of probate proceedings: The national average fee for a formal probate following someone’s death is 7.4 percent of the total value of the estate. Creating a trust allows you to minimize these expenses.
  • Protection from unnecessary taxation
  • Protection from long term care costs: Long term care expenses are the number one cost for the elderly today. For example, in October of 2009, studies found that in Maricopa County, Arizona, the average cost of long term care is $5,942 per month. Medicaid or public benefit triggers can be used in trusts to minimize your exposure.
  • Protection from creditors: Your children’s inheritance can be protected through a beneficiary trust.

Besides protecting your assets, having a trust gives you confidence that your wishes will be honored and your loved ones taken care of as you desire.

If you already have a trust it is very important that you make sure it is up to date based on changes in your assets, family circumstances, and the enactment of new laws. For example, in 2009 there were significant changes to the Arizona Trust Code changing accounting and certification requirements.

Steps You Should Take:

  1. If you already have a trust and estate plan, discuss the details and any changes with your children or beneficiaries at least once a year. Make sure they know where to find key documents.
  2. Discuss your trust annually with your financial advisor to make sure all your assets and your trust are working together.
  3. If you need a trust created, or it has been a few years since your trust has been reviewed, make an appointment with MH for a free consultation.
  4. Encourage your children to meet with MH as well. At the bare minimum they should have the following: a last will and testament, a living will, a health care power of attorney and a HIPAA document. Importantly, a will specifies who would care for your grandchildren should something happen to your children.
This article should be used for informational purposes only.  It does not create an attorney-client relationship with any reader and should not be construed as legal advice.  If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.